Reconsideration on biomass diesel volumes requested

On 20th November the AFPM filed a petition for reconsideration of the EPA’s final rule Regulation of Fuels and Fuel Additives: 2013 Biomass Based Diesel Renewable Fuel Volume. The rule increased the volume of biomass based diesel from 1.0 billion to 1.28 billion gal.

The AFPM strongly urges that the EPA reconsider its decision to increase the biomass based volumes by 28% in 2013. Since the EPA initially issued the rule, a number of factors have surfaced that could result in unintended consequences that will adversely impact both the domestic refining industry and US consumers.

‘EPA’s own data estimates that the cost of increasing the biomass based diesel mandate will add between US$ 253 million and US$ 391 million to consumers’ transportation fuel bill in 2013,’ commented Charles T. Drevna, AFPM President. ‘The US economy is still struggling and this increase will hurt the million who rely on transportation fuels.’

Evidence is strong that an increase in the 2013 volume will not affect domestic energy security, as the US currently is a net exporter of diesel, contrary to research carried out by the EPA. In the category of unintended consequences, EPA’s decision will curtail investment in advanced biofuels that compete with biodiesel and will increase carbon emissions in 2013 under the RFS. It is also possible that the increase could negatively impact the price and supply of agricultural commodities, since additional biodiesel feedstocks, such as soybean oil, will be required under the rule.

Drevna continued, ‘Before increasing the 2013 volume, EPA must resolve the pervasive problem that exists in the biodiesel market of Renewable Identification Number (RIN) fraud. To date, over 140 million fraudulent RINs have been sold to unsuspecting refiners concerned with meeting their RFS obligations. That number and the costs associated with the fraud will grow as investigations of additional biodiesel producers continue today.’